The credit bureau was mandated by a ruler's decree last week to collect and process credit information in Dubai, the emirate that is struggling with a multibillion debt pile.

The initiative is considered by analysts and bankers a positive development for the local credit market, as banks with better credit information are more likely to lend more to small- and medium-sized businesses or individuals, which previously had little or no credit history.

"In all markets where credit bureaus exist, credit penetration is greater," Ziad Kamhawi, chief business officer at Emcredit, told reporters.

Dubai's large-scale debt woes, combined with sluggish economic growth, have hampered credit growth in the past year, as cash-hungry banks have become more reluctant to lend. The downturn has translated into a rise in defaults against which banks had to book provisions.

"It played a direct part: contracting credit and a rise in NPL's (non-performing) loans have highlighted the need," said Kamhawi. "Banks have been calling for a credit bureau to be fully developed."

Ali Khan, managing director and head of brokerage at Arqaam Capital, said: "This will provide much better visibility to the lender vis-a-vis the borrower ... Bank lending with more visibility will improve the quality of the loans."

Dubai's only credit bureau currently has access to 30 percent of all banking data available but this is likely rise to around 80 percent after the decree, as other banks operating in Dubai will also have to work with Emcredit.

Other countries in the Gulf have also either set up or are planning credit bureaus and Qatar's central bank said in March it was in the final stages of setting one up.